Posts Tagged ‘HP’

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Can HP Survive? Do They Have The Secret CIO “Juice”?

Monday, June 8th, 2009
Mark Hurd Has Done Wonders At HP - Now Can He Find Enough Innovation?

Mark Hurd Has Done Wonders At HP - Now Can He Find Enough Innovation?

HP’s CIO Randy Mott has done some fantastic things in helping to turn the company around. However, now things are starting to get tricky and it’s not clear that the company is going to be able to continue to be successful. Everyone seems to think that what they need is a shot of that “innovation juice” and it’s not clear that Randy’s going to be able to deliver it…

What HP Did Right

Ok, so let’s admit it – HP had lost their way under Carly Fiorina’s guidance. They brought in Mark Hurd as CEO (who then brought in Randy Mott as CIO) to turn things around. Hat’s off to Mark – he’s done a great job.

Ashlee Vance over at the New York Times had a chance to talk with Hurd awhile back and he revealed that he sees HP in terms of four “quadrants“. These quadrants include operations, products, business & technology trends, and competitors.

Clearly Hurd has an analytical outlook on life – many people have remarked on just how good he is with balance sheets and dealing with numbers in general. It turns out that this is both good and bad.

The Problem That HP Has Now

HP has done a fantastic job of cutting staff, reducing costs, and negotiating great deals on parts. Having achieved just about all of the benefits that one can get from doing these types of actions, the question that comes up is “what next?”.

Shareholders like growth and in the immediate past, HP’s been growing by cutting. Now that that’s all done, how will it maintain its growth? This is where that pesky thing called innovation comes in…

Old Solutions Won’t Work!

HP used to be able to count on the famous HP labs to come up with new product ideas that would show them the way forward. However, in the current era of budget cutting and project justifications, HP has shrunk the number of projects that their labs are working on from 130 down to about 50. That may not be enough to have enough of those “eureka” moments where breakthroughs happen.

Next Steps For HP

The trick here is to find a way to recapture that “juice” that a technology company like HP needs to have in order to survive. This is exactly where CIO Randy Mott should step in.

As CIO of HP, Randy is in a unique position to help Hurd out. Since HP sells information technology products and services, their very own CIO is the person who can help them evaluate which ideas they need to run with.

Yes, yes – both Hurd and Mott like to run a tight ship with metrics ruling the day. I believe that that time has come and (partially) gone. Now is the time for Mott to throw open the doors to his IT department and start up some trial projects and initiatives. HP is so large that they could easily run multiple evaluations in parallel.

Final Thoughts

HP has made a remarkable comeback from the brink of despair. However, as they try to move forward, innovation and clever sparks of imagination are what’s going to be needed. HP’s CIO Randy Mott has the resources and the talent in his shop that would allow HP to use itself as a testing ground for encouraging its employees to make suggestions and have them tried out. Let’s see if they make the most of this opportunity…

Questions For You

Has your IT department lost its spark of creativity due to relentless efforts to drive costs out of your organization? Do you think that just having a highly efficient organization is all that is needed or does innovation also play a role? What do you think HP could do in order to re-awaken its innovation engine? Leave me a comment and let me know what you are thinking.

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Coming Up Next Time

What would you say is the biggest challenge that CIOs are facing today? All that today’s CIOs seem to get a chance to talk about is costs. What’s missing here is a way for CIOs to communicate in a company-wide manner just how much value the investments that the company is making in IT are returning – the revenue of IT if you will…

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Posted in innovation | 4 Comments »

Three Big IT Transformation Mistakes That HP Made

Wednesday, May 13th, 2009
HP's IT Department Made Some BIG Mistakes During Their Transformation

HP's IT Department Made Some BIG Mistakes During Their Transformation

If you made three costly IT mistakes would you admit it? I think that most of us would probably say “no” – we’d run and hide our mistakes under a rock somewhere. However, thankfully over at HP they’ve decided to come clean about a few of the mistakes that they’ve made during their multi-year IT transformation project. We can all learn from their mistakes.

HP’s CIO Randy Mott decided to remake HP’s IT department when he came on board a few years ago. In order to kick the project off, they needed to make some assumptions about how things were operating and move forward.

Chris Murphy over at InformationWeek had a chance to sit down with Randy and ask some questions about where HP’s assumptions were just flat out wrong. What he’s learned holds a lot of information for all of us. Here are the big three:

  1. The Secret World Of IT: When HP decided to remake their world of IT, they had to start the process by finding out how big the IT operations were. They grossly undercounted. Going in they thought that HP was using 3,500 applications to run the business. It turns out that they were using more like 6,000. They knew for sure that they had 85 data centers being used by the business. Ultimately, they ended up discovering more than 400 locations where they had massed computing infrastructure.
    Lesson Learned: take the time to do a complete inventory BEFORE you ever start any sort of IT transformation.
  2. Plan For Growth: It sure would be nice if we could freeze time, make changes to our IT departments, and then start things back up again. HP seems to have thought that they could do this because they didn’t remember to plan for acquisitions to occur during the project. Well, you know how this story goes – HP kept buying up other firms and since there was no IT incorporation plan, it caused big headaches for the IT team that was trying to transform IT.
    Lesson Learned: Create a solid process for bringing in new IT departments to any ongoing projects.
  3. Beware Of Success: Once again, the business keeps moving while IT works on its projects. In this case, HP shot past their growth projections. What this ended up doing was pushing the IT transformation project off of its tracks – data centers that were to be consolidated were suddenly needed because they were supporting unplanned for growth.
    Lesson Learned: Make sure that you have a backup plan that tells you what you are going to do if sales projections change from what has been forecasted.

In the end, HP was successful with their IT transformation and they ended up reducing those 6,000 applications down to about 1,500, reducing those 400 data centers down to 6, etc. However, because of the three mistakes that they made, this difficult job was made just that much harder. Now you know – don’t repeat this mistakes!

Have you ever been surprised to discover that there is a whole “shadow IT” department operating in your business that nobody has ever counted? Has a merger or acquisition ever screwed up one of you IT project’s schedule? Has your IT department ever been surprised by unexpected growth? Leave me a comment and let me know what you are thinking?

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Posted in process | 1 Comment »

IT Work Split: The New 80/20 Rule

Monday, May 11th, 2009
IT Departments Need To Apply The 80/20 Rule To Support Work

IT Departments Need To Apply The 80/20 Rule To Support Work

Pity the poor CIO – he manages a team of professionals that do great work, but he / she rarely gets any credit for a job well done. Why you ask? Well an unfortunate comparison can be made to the maintenance staff that takes care of the building that your work in. It’s great that they keep everything up and working and looking good, but how often do you ever really think about them?

What’s missing here is for CIOs to determine what the right work split is for their team. No matter what we do, there is always going to be some support and maintenance work to be done, but how much is too much?

HP’s CIO Randy Mott was facing this problem when he came on board a few years ago and he’s moved quickly to try to resolve it.

Chris Murphy over at InformationWeek had a chance to sit down with Randy and ask some questions about how he’s gone about getting his team to work on the things that really count.

When Mott first joined HP the IT department was spending about 70% of its time doing support work – keeping the network up, resetting passwords, recovering deleted files, etc. This meant that only 30% of their time was being spent doing things that moved the company forward.

So did Mott do? First he cut his IT payroll almost in half – they went from 19,000 staff (50/50 contractors and employees) down to under 10,000 (90% of which are employees). The thinking here is that if you are just doing support, it really doesn’t matter who doing the job, contractor or employee, as long as it gets done. However, if you are doing mission critical system development, then the person doing the work had better be an employee so that you’ll have continuity.

The way that Mott figured out who to keep and who to let go was by documenting what everyone was doing. Once a week folks would stop and document what they had been working on that week. The thought was that if you don’t have good data on what folks are doing, then you can’t make good decisions about what they SHOULD be doing.

One other key change that HP made is in how they define work. There are only two buckets these days: support or “new development”. No middle ground is permitted so say goodbye to “enhancements”.

In the end, Mott’s been able to get his work split to a 70 / 30 mix. It’s not quite the 80 / 20 that he’s shooting for, but he’s getting close. This approach also allowed Mott to get enough data to be permitted to decommission some popular but high maintenance applications. How many other IT departments wish that they could do that?

What is the work split between support and new development in your department? What would you like it to be? What steps are you taking to reduce the amount of time that your team spends on support activities? Leave me a comment and let me know what you are thinking.

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Posted in process | 2 Comments »

What Can HP Teach You About How To Run Your IT Department?

Monday, April 27th, 2009

HP's CIO Has Taken Bold Steps That Can Teach Us A Few Things

HP's CIO Has Taken Bold Steps That Can Teach Us A Few Things

When I say “HP” what is the first thing that pops into your mind? In my case it’s a flashback to the HP 12C calculator that became welded to my hand while I was working on my MBA. These days, HP does a lot more and we all probably have some HP printers or PCs laying around somewhere. However, it’s what HP’s CIO Randy Mott has been up that has caught my attention.

Let’s start with results because otherwise Randy’s story really isn’t worth telling: HP has cut IT spending from 4% or revenue to about 2% of revenue, 70% of staff’s time spent on new development with just 30% being spent on support, shrunk 85 data centers down to just 6, 6,000 applications shrunk down to 1,500. Wow – sure looks like Randy must be walking on water, eh?

Any CIO would lust after results like these. However the devil is, as always, in how Randy got them. Chris Murphy over at InformationWeek did some digging and found out that Randy had to do a number of things that would make even the strongest of us think twice.

Randy’s most important strategy: he realized that it was not just enough to identify the big areas of HP’s IT department that needed to be transformed, what he needed to do was to go after all of them at the same time as one big, huge, effort.

Here’s what he took on (all at once): portfolio management, IT workforce effectiveness, world class IT organization, global data center consolidation, and a single enterprise data warehouse. Whew! You could build a CIO career on any one of those.

To accomplish all of this, HP needed to get their metrics right. Here’s what they measured:

  1. On-Time Delivery: Just like pizza, this is what really can make an IT department have some credibility. HP went one step farther – it’s weighted so delivering big projects on time counts for more than delivering a bunch of little projects on time.
  2. Time Spent Innovating: This measures how much IT time is spent working on new things as opposed to doing support tasks.
  3. Time-Phase Boxing: Similar projects should take the same amount of time to do similar phases. This metric serves as a warning flag if a project is starting to go off course.
  4. Collaboration: how many different locations are involved in a project? The goal here is to keep this number as low as possible.
  5. Cost / Benefit Analysis Validation: In a nutshell, this is an agreement BEFORE the project starts as to what it’s going to cost and what value it’s going to deliver. This metric tracks how close the team is to completing the CBA and nobody starts the project until it’s complete.

Do you think that your IT department could take all of these major initiatives on at the same time? Which of these metrics do you think would provide you with the best insights into how your IT projects are doing? What metric should be added to this list? Leave me a comment and let me know what you are thinking.

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Posted in CIO | 6 Comments »

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